STRATEGIC USES OF REEXAMINATION IN LITIGATION
Donna Meuth Contested Matters Committee September 23, 2009 Why reexamination?
Reexamination should be part of your patent strategy when: You learn of an important patent You receive a threatening letter Litigation is filed You are in a larger business dispute You own the patent
WilmerHale 1 What is reexamination?
A reexamination is a procedure in which the Patent Office examines the patentability of an issued patent
WilmerHale 2 Reexamination – Two Kinds
Ex parte
– Patent owner or third party can file a request for reexamination
– Third party can remain anonymous
– Generally, third party has no further participation after the request
– Patent owner can interview Examiner
– Can be appealed by patent owner to the BPAI
– Less expensive
WilmerHale 3 Reexamination – Two Kinds (cont.)
Inter partes
– Only applies to patents from patent applications filed on or after November 29 , 1999
– Filed only by third party and must be identified
– Third party participates in reexamination process
– No interviews with the Examiner
– Can be appealed to the BPAI or Federal Circuit by patent owner or third party
• Third party can participate in appeal filed by owner
WilmerHale 4 Reexamination – Estoppel
Inter partes is not widely used because of its broad estoppel
– Requestor estopped from raising issues that were raised or “could have been raised” in subsequent proceedings, including litigation
– Requestor not estopped from asserting invalidity “based upon newly discovered prior art unavailable to the third- party requestor . . . at the time of the . . . reexamination proceedings”
WilmerHale 5 Reexamination – Two stage process
Patent office determines whether there is a “substantial new question of patentability” (SNQP) Examination of claims
– Challenges must be based upon patents and printed publications
– No other bases accepted: public use, on sale, earlier invention, etc.
WilmerHale 6 Reexamination – Timing
Can be filed any time during the patent term PTO determines if SNQP exists, usually within 2-3 months If reexamination process starts after or extends beyond pppatent expiration, claims cannot be amended Ex parte certificate issues in about 25 months Inter partes certificate issues in about 34 months
WilmerHale 7 Reexamination – Examination
Generally, similar to regular prosecution, except:
– 101 and 112 rejections only to new claims and amendments
– No automatic extensions
– Conducted with “special dispatch” Must appeal unfavorable decisions – no continuations
WilmerHale 8 Results of Reexamination
Certificate that each claim in reexamination is:
– Confirmed (without amendment)
– Allowe d (w it h amen dment )
– Cancelled Intervening rights for defendant
– For claims that are added or amended in reexamination, they apply only after certificate is issued
WilmerHale 9 STATISTICS
WilmerHale 10 Inter Partes Data
671 total requests since start of inter partes reexamination on 11/29/99 The trend is up:
– 2002: 4
– 2005: 59
– 2008: 168
– 2009: 195 ((gthrough June ) 446 (66%) known to be in litigation
source: www.uspto.gov, “Inter partes Reexamination Filing Data” 6/30/09
WilmerHale 11 Inter Partes Data (cont.)
Re-exam granted: 95% Length of pendency: average: 36.1 months median: 33.0 months 95% of re-exams = claims cancelled or changed 5%: all claims confirmed 60%: all claims cancelled or disclaimed 35%: claims change
– 77 (of the 671) have an issued re-exam certificate
WilmerHale 12 Ex Parte Data
10066 total requests since 1981 The trend is up:
– 1988: 268
– 1998: 350
– 2008: 680
– 2009: 481 (through June) 3079 (31%) known to be in litigation
source: www.uspto.gov, “Ex parte Reexamination Filing Data” 6/30/09
WilmerHale 13 Ex Parte Data (cont.)
All Ex Parte Re-exams Re-exam granted: 92% Length of pendency:
– average: 25.1 months
– mean: 19. 5 months 75% of re-exams = claims cancelled or changed
– 25%: all claims confirmed
– 11%: all claims cancelled or disclaimed
– 64%: claims change
WilmerHale 14 REEXAMINATION AND LITIGATION BPLA Contested Matters Committee Susan G. L. Glovsky September 23, 2009 Types of Reexamination
• RititdbReexamination requested by patentee – Before litigation is pending – During litigation • Reexamination by third party – Ex parte • Identifying real party in interest • Multiple requests – Inter partes Requests by Patentee
• Can pa ten tee st ay it s own liti ga tion ? • Reasons for patentee to request reexamination? • Reasons not to request reexamination? • Handling of patentee request for maximum benefit in ensuing litigation? Third Party Requests
• TttTo reexam or not to reexam • Negatives – Likelihood patent will emerge from reexamination with claims intact, and perhaps not even amended – Gives the Patent Office seal of approvalthttl on the patent – Provides the patentee the opportunity to i mprove it s pat ent positi on Reexam Positives
• Cou ldbld be a ttltotal w in w ith no pa ten tlftt left • Forces patentee to fight on multiple fronts • With a stay – Delays and could eliminate enforcement – Delay could simply result in change in circumstances advantageous to accused infringer – Permits accused infringer without resources for a court fight a forum for invalidity defense Ex parte or Inter partes
• Once ex parte itdiis requested, in general the cost is over • Inter partes is more costly, but requestor continues to participate, which can result in greater likelihood of success • BUT estoppel applies in inter partes but not ex parte reexamination What About Staying Litigation?
• Shou ld a mo tion for a s tay be gran te d? – Pro: The Patent Office is better able to determine issues involving patentability – Con: If (when) the patent emerges from reexamination, the Court will address some of the same issues that were considered in the reexamination, along with infringement and damages issues with evidence that has gotten old and stale Case Experiences
• DlDelay succee ds in ac hiihieving a settlement – Circumstances change – Companies or divisions get acquired • Cases that were not stayed RIM • Dismissal of case without prejudice to refiling • Denial because too late in Court action Case Experiences
• EiExperiences w ithtdith stayed cases proceeding after reexamination is over? Susan Glovsky [email protected] 978-341-0036 September 23, 2009 Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
Litigation and Reexamination
Mic hae l R. Mc Gur k BPLA Contested Matters Committee Sepp,tember 23, 2009 Disclaimer
• These materials are public information and have been prepared solely for educational purposes to contribute to the understanding of American intellectual property law. These materials reflect only the personal views of the author and are not individualized legal advice. It is understood that each case is fact-specific, and that the appropriate solution in any case will vary. Therefore, these materials may or may not be relevant to any particular situation. Thus, the author and FINNEGAN cannot be bound either philosophically or as representatives of their various present and future clients to the comments expressed in these materials. The presentation of these materials does not establish any form of attorney-client relationship with the author or FINNEGAN. While every attempt was made to insure that these materials are accurate, errors or omissions may be contained therein, for which any liability is disclaimed.
22 Validity Upheld But “Dubious” Wait for USPTO Reexam to Invalidate? • Fresenius USA, Inc. v. Baxter International, Inc., --F.3d– (Fed. Cir. Sept. 10, 2009)
– Fresenius filed DJ of noninfringement and invalidity
– Jury: claims invalid as obvious.
– DC: JMOL that jury verdict was not supported by substantial evidence -> claims valid.
– FC: Reversed the district court’s grant of JMOL. Remaining claims in pending reexam.
33 Validity Upheld But “Dubious” Wait for USPTO Reexam to Invalidate? • Fresenius (con’t) – DYK, Circuit Judge, concurring
• Majority opinion should not “foreclose the district court in its discretion from staying further proceedings pending the outcome of the reexamination.”
• “While Fresenius did not establish the invalidity of claims 26–31 … in the district court ppgroceeding, those claims on their face are of dubious validity in light of our holding that claims 1–3 and 13–16 … and claim 11 are invalid. It is entirely possible that the U.S. Patent and Trademark Office will finally conclude that claims 26–31 of the ’434 patent are also invalid.”
44 Validity Upheld But “Dubious” Wait for USPTO Reexam to Invalidate? • Fresenius (con’t) – Judge Newman, dissenting
• A stay would be: “[inappropriate] at this stage in this protracted litigation, after full trial and decision in the district court, after full appeal and ruling of the appellate court and with only a modified remedy remaining on remand. . . . A stay of finality, after the issues of validity and infringement have been litigated and decided by the district court and appealed to the Federal Circuit, is a distortion of the role of reexamination.”
• “I remain a strong supporter of the principle of reexamination. It can be a useful and powerful tool for the benefit of both patentees and those interested in restricting or eliminating adversely held patents. However, if routinely available to delay the judicial resolution of disputes, the procedure is subject to inequity, if not manipulation and abuse, through the delays that are inherent in PTO activity.”
55 Validity Upheld But “Dubious” Wait for USPTO Reexam to Invalidate? • Fresenius (con’t) – Judge Newman, dissenting
• “The relationship between reexamination and litigation is not new to the courts, and precedent reflects the variety of responses in particular situations. It is established that a ‘court is not required to stay judicial resolution in view of the reexaminations.’ … The corollary rule is that the PTO has no authority to stay reexamination pending the outcome of district court litigation. A stay of finality, after the issues of validity and infringement have been litigated and decided by the district court and appealed to the Federal Circuit, is a distortion of the role of reexamination.”
• “Our colleague in concurrence appears to believe that a PTO decision on reexamination will override a judicial decision reached after trial and appeal. That is incorrect. All that can be accomplished is delay.”
66 Validity Upheld But “Dubious” Wait for USPTO Reexam to Invalidate? • Fresenius (con’t) – Judge Newman, dissenting
• “the number of reexamination requests is increasing, as is the time for completion of reexamination and appeal in the PTO, as well as the right of judicial review. In its recent statistical summaries, the PTO reports a 54% increase in filing of ex parte reexaminations since 2004 (from 441 in 2004 to 680 in 2008, an d w ith 481 filings throug h June 2009). [source citation omitted] Of these filings 31% were reported to be in litigation. … Inter partes reexaminations are increasing rapidly, from 168 in 2008 to 195 filings through June of 2009, with 66% reported to be in litigation. … The PTO also reports that as of the third quarter of 2009, the average pendency for ex parte reexamination is 36.1 months, an increase from the 34.6 months at December 2008. … The pendency of inter partes reexamination is reported to average 41.7 months.
• “the present case is over but for review of the remedy on remand. The suggestion that the district court should now stay the proceedings, at this final stage, is contrary to the precepts of expeditious and just resolution of disputes.”
77 When Are Stay Orders Appealable?
• Slip Track Systems, Inc. v. Metal Lite, Inc., 159 F.3d 1337 (Fed. Cir. 1998)
– DC: stayed infringement action pending outcome of reexamination and refused to enter preliminary injunction. • “[a] decision from the PTO as to the validity of the [Brady] patent could substantially narrow the issues in this federal litigation.”
– FC: Vacated and remanded. • “In many instances it is appropriate for a district court to stay a patent case pending the ou tcome o f a PTO proceedi ng. I n thi s case, h owever, the stay was improper, because a foreseeable consequence of staying Slip Track's interfering patents suit in favor of the reexamination proceedings is that Slip Track will be unable to raise the issue of priority of invention in any forum.”
88 “when it is clear that no further action is contemplated by the district court” • Slip Track (con’t) –FC: • Issue is priority of invention • an order staying a case is generally not subject to appeal • Stay appealable in this case because it effectively disposes of the district court action. – cannot litigate priority issues in the PTO reexamination – cannot swear behind the anticipatory reference – reexamination likely to result in the cancellation of all of the claims, leading to a dismissal of the interfering patents suit, – district court will never consider the issue of priority of invention
• “the district court should move forward with the interfering patents suit rather than staying the suit in favor of the PTO proceeding.”
• In this case , the outcome of the reexamination “will not assist the district court in determining priority of invention, and while the reexamination would likely eliminate the need for a trial on priority or infringement, that result would come at the expense of denying Slip Track any opportunity to prove that Brady was the first to invent and that th e B rad y pat ent th eref ore i s entitl ed t o pri orit y.”
99 Stay of Reexam Proceedings
• Ethicon, Inc. v. Quigg, 849 F.2d 1422 (Fed. Cir. 1988) – USSC sued 3 parties in D. Conn., and later sued Ethicon in S.D. Ohio – Ethicon filed a request for reexamination, and then requested a stay from the Ohio court – S.D.Ohio: Denied reqqyuest for stay. – In the PTO, USSC filed a “Petition to Stay Reexamination Proceeding Pursuant to 37 C.F.R. § 1.565 and MPEP § 2286” “in deference to an ongoing trial being conducted” in D. Conn. – PTO stayed the reexamination pending the decision of the D. Conn. court. – Ethicon filed a request with E.D. Va. to enjoin the Commissioner from delaying the reexamination
1010 Stay of Reexam Proceedings
• Ethicon (con’t) – E.D. Va.: Granted summary judgment that the Commissioner has the authority to stay a patent reexamination proceeding pending the outcome of a case in another district court involving allegations that the same patent is invalid. – FC: Reversed and remanded. • The district court thought that one of the purposes of the legislation was to avoid duplication of efforts by the PTO and the courts. … Nothing in the statute or legislative history supports this … precise duplication of effort does not occur because the PTO and the courts employ different standards of proof when considering validity, and the courts, unlike the PTO during a reexamination of patent claims, are not limited to review of prior art patents or printed publications, … but may also consider challenges to validity on other grounds. • “the suspension of PTO proceedings does not prevent duplication; it precludes access to the forum where there is no presumption of validity.”
1111 Stay of Reexam Proceedings
• Ethicon (con’t) – FC: “That one challenging validity in court bears the burden assigned by [35 U.S.C.] § 282, that the same party may request reexamination upon submission of art not previously cited, and that, if that art raises a substantial new question of patentability, the PTO mayyg during reexamination consider the same and new and amended claims in light of that art free of any presumption, are concepts not in conflict. On the contrary, those concepts are but further indication that litigation and reexamination are distinct proceedings, with distinct parties, purposes, procedures, and outcomes.
1212 Stay of Reexam Proceedings
• Ethicon (con’t) – FC: “The awkwardness presumed to result if the PTO and court reached different conclusions is more apparent than real. The two forums take different approaches in determining invalidity and on the same evidence could quite correctly come to different conclusions. Furthermore, we see nothing untoward about the PTO upholding the validity of a reexamined patent which the district court later finds invalid. This is essentially what occurs when a court finds a patent invalid after the PTO has granted it. Once again, it is important that the district court and the PTO can consider different evidence. Accordingly, different results between the two forums may be entirely reasonable. And, if the district court determines a patent is not invalid , the PTO should continue its reexamination because, of course, the two forums have different standards of proof for determining invalidity.”
1313 “Substantial New Question Of Patentability”
• In re Swanson, 540 F.3d 1368 (Fed. Cir. 2008) – Patent: “A method for analysis of an analyte which is a member of a ligand-antiligand binding pair in a test solution…” – Prior art disclosed a method of detecting ligand-antiligand binding pairs in order to determine the presence of a ligand (the analyte) in a biological fluid sample – 2003: Federal Circuit affirmed district court judgment that claims not invalid. • Issue: did Deutsch teach “flowing said solution along the medium”? • Jury could have itinterpre tdted clilaims as requiiiring thesoltilution itself provide the required flow.
1414 “Substantial New Question Of Patentability”
• Swanson (con’t) – Syntron filed request for ex parte reexamination. – EiExaminer rejtdjected clilaims as antic ipa ted and obibvious under Deutsch. – May, 2007: Board upheld examiner's rejection. • Deutsch “raised a substantial new question of patentability despite having been cited in the original office action because it was not cited in regard to the presently rejected claims and it was not relied upon for the same reason the examiner now relied upon it.” • Dismissed argument that “Deutsch could not raise a substantial new question of patentability because a jury had affirmed a finding of no invalidity over the reference and the Federal Circuit had affirmed.”
1515 “Substantial New Question Of Patentability”
• Swanson (con’t) – FC: Affirmed claims invalid. • Under 35 U.S.C. § 303(a), despite consideration of Deutsch in the initial examination and prior court decision, there was a substantial new question of patentability. •“district court and this court did consider the precise question at issue on reexamination: whether Deutsch satisfies the “flowing” limitation of the asserted claims and, thus, anticipates them. And both courts upheld the validity of the ′484 patent in light of Deutsch. Nevertheless, thesttttatutory language, liltilegislative his tory, and differen t purposes underlying reexamination and federal court proceedings suggest that the determination of a substantial new question is unaffected by these court decisions.”
1616 “Substantial New Question Of Patentability”
• Swanson (con’t) – “’substantial new question of patentability’ refers to a question which has never been considered by the PTO; thus, a substantial new question can exist even if a federal court previously considered the question.”
• Congress concerned only with consideration of issues in prior PTO examinations, not prior civil litigation. – § 303(a) aadnd legi sl ativ e histor y.
• Different standards, parties, purposes, and outcomes – Preponderance of evidence vs. clear and convincing evidence. – No presumption of validity. – Claims given broadest reasonable interpretation.
1717 “Substantial New Question Of Patentability”
• Swanson (con’t) – “To hold otherwise would allow a civil litigant's failure to overcome the statutory presumption of validity to thwart Congress' purpose of allowing for a reexamination procedure to correct examiner errors, without which the presumption of validity never would have arisen.”
– “In light of the extremely limited purpose for which the examiner considered Deutsch in the initial examination, the Board is correct that the issue of whether Deutsch anticipates the method disclosed in claims 22, 23, and 25 was a substantial new question of patentability, never before addressed by the PTO.”
1818 “Substantial New Question Of Patentability”
• Swanson (con’t) – Proper question isn’t whether Deutsch was considered, but whether the particular question of patentability presented by the reference in reexamination was previously evaluated by the PTO • Context • Scope of consideration – In initial examination, Deutsch relied upon, as a secondary reference, for the limited purpose of teaching immunoreactions in general, not for the specific method steps claimed – In reexamination, Deutsch relied upon as anticipatory reference.
1919 “Intervening Rights”
• “when a patent has been reexamined by the United States Patent and Trademark Office, a patentee may recover damages for infringement that occurred before issuance of the reexami na tion cer tifica te on ly if the in fr inge d c la ims are ‘substantially identical’ in the reexamined and original patents.” – 35 U. S. C. §§ 252, 307(b)
• Engineered Data Products, Inc. v. GBS Corp., 506 F.S upp .2d 461(D . Colo. March 23, 2007) – Some claims “substantially identical” -> no intervening rights – Some claims not “substantially identical” -> intervening rights
2020 “Intervening Rights”
• Engineered Data Products (con’t) – Claim 1. Apparatus for automatically producing a series of labels, each label in said series of labels containing a set of indicia individual to said label and ordered according to a user defined ordering, comprising: …; and means for automatically printing each of said individually identified labels in said series of labels on to label media, so that each of said individually identified labels includes color printing on said label media within one or more of said indicia fields accordinggp to the predefined color to indicia correspondence. (emphasis added to reexam amendment)
2121 “Intervening Rights”
• Engineered Data Products (con’t) – DC: Amendment simply made explicit what was already implicitly included. • “by requiring the insertion of color coded indicia on each label in the series and the automatic printing of each label, necessarily requires the printing of color on each label according to the predefined color to indicia correspondence, i.e., the automatic printing of labels that included color coded indicia. ” • Specification supports that “the original color claims required the printing of the individually identified labels generated by the process they described. The specification repeatedly emphasizes the printing of indicia onto each individually identified label.” • “examiner reported that these claims were amended ‘to highlight’ the process of color printing following his suggestion that “emphasizing” this process could overcome the prior art of record. … the amendments merely clarified or made this limitation explicit.”
2222 “Intervening Rights”
• Engineered Data Products (con’t) – Amended Claim 29 is set out below, with text from original Claim 17 shown in italics, text from original Claim 22 shown in underlined italics, text from original Claim 29 shown in normal text, and new language shown in bold and deletions shown in strikeout. – 29. includes Apparatus for automatically producing a series of labels, each label containing indicia individual to said label, comprising: means for defining a label template containing one or more writable indicia fields; means for automatically generating indicia for each of said indicia fields on each of said labels in said series according to a user defined label identification ordering to individually identify each label, comprising: means for generating first and second sets of indicia, said second set of idiiindicia bibeing a [rep liti]lication] co ddded vers ion …, compriiising: means for overlaying said first and said second sets of indicia, and means for automatically printing said defined series of labels on label media so that printing said labels includes printing the overlaid first and second sets of indicia.
– second set can be different, as opposed to a “replication” of the first set of indicia. – original claim language, “replication” is a set of indicia “in a different indicia form,” is the same as a “coded version” of the indicia. 2323 “Intervening Rights”
• Engineered Data Products (con’t) – “The concept included in “code” or “coded” that is missing from the origgpinal claim's use of the term “replication” is that the second set of indicia has an “assigned definite meaning” relative to the first set of indicia. Accordingly, the ordinary meaning of the second set of indicia being a “coded version” of the first set of indicia is substantively different from the second *475 set of indicia being a “replication” of the first. – scope of overlay claims and their dependent claims was substantively changed during reexamination -> not substantially identical, the doctrine of intervening rights bars recovery of damages for their alleged infringement before issuance of the Reexamination Certificate.
2424 How Do Reexam Proceedings Impact Other Proceedings and Vice Versa? • In re Trans Texas Holdings Corp., 498 F.3d 1290 (Fed. Cir. 2007) – Board not bound by earlier claim construction issued from district court
• CdiCCordis Corp. v. MdtiAMedtronic Ave, Inc., 511 F. 3d 1157 (Fe d. Cir. 2008) – Prosecution historyypppp estoppel applies from comments made durin g reexam proceedings – Claim added during reexam may not broaden scope, 35 USC § 305; must distinggpuish over prior art or be res ponsive to adverse decision on patentability.
2525 USPTO Reexam Stats
394 597 400 441 524 511 643 680 385 392 329 350 287 318 276 300 243 296 272 223 250 200 193
200 138 168 150 126 100 59 70 50 21 27 0 0 1 4 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Ex parte reexam requests 385 318 296 272 392 441 524 511 643 680 Inter partes reexam requests 0 0 1 4 21275970126168
Reexam certificates issued 243 276 287 200 193 138 223 329 394 597
26 2626 USPTO Reexam Stats
Ex parte reexamination average pendency 24.9 months (2008) Inter partes reexamination average pendency 34.9 months (2008)
68% 70% 64%
60% 57% 50% 45% 46% 46%
40%
30% 20%
10%
0% 2006 2007 2008 Ex parte reexams with related 45% 57% 46% litigation Inter partes reexams with related 46% 64% 68% litigation
27 2727 USPTO Reexam Stats
Claims maintained Claims Claims amended without change rejected/revoked (clear win for p’ee) Ex parte reexam certificates issued 25% 11% 64% (1981-present) Inter partes reexam certificates issued 9% 70% 21% (1999-present)
70% 70% 60% 64% 50% Claims 40% maintained 30% Claims 20% 25% 21% canceled Claims 10% 11% 9% amended 0% Ex parte Inter partes reexam reexam 28 2828 Thank You!
Michael R. McGurk 617.452.1619 michael.mcgg@urk@finne gan.com
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